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tv   Squawk on the Street  CNBC  October 20, 2016 9:00am-11:01am EDT

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>> dan, you met with both candidates. quick takeaways? >> i was fortunate enough to meet with both of them in the last few weeks, actually with one-on-one meetings in detroit as they came through. i'll tell you it was a fascinating situation -- >> about ten seconds. >> seeing them privately versus public. i mean, very different both of them i thought were very, very different in person. >> interesting. >> better. both of them better in person. >> both better. all right, thank you, dan gilbert. wilf, are you here tomorrow? >> no. >> okay. well, thank you for being here the last two days. >> thank you. >> it will be a surprise tomorrow for me and everybody else. make sure you join us. "squawk on the street" is next. from everything i see has no respect for this person. >> well, that's because he'd rather have a puppet as president -- >> no puppet, no puppet.
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>> -- of the united states. it's pretty clear that you won't admit that the russian -- just one of the barbs from last night's presidential debate. good morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock exchange. david faber on today. europe slightly in the red. ecb leaves rates steady, leaves little sign of sustainable inflation, oil back below $51. our top story this morning in their final debate hillary clinton and donald trump squared off on the economy, taxes and foreign policy. but the headline for many remains the moment when trump said he would not commit to accepting the election results. >> chris, she should never have been allowed to run for the presidency based on what she did with e-mails and so many other things. >> but, sir, there is a tradition in this country, in fact one of the prides of this country is the peaceful transition of power and that no
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matter how hard fought a campaign is that at the end of the campaign that the loser concedes to the winner. not saying you're necessarily going to be the loser or the winner, but if the loser concedes to the winner and that the country comes together in part for the good of the country, are you saying you're not prepared now to with that principle -- >> what i'm saying i'll tell you at the time. >> chris, let me respond to that because that's horrifying. >> jim, some today are calling it today an affront to democracy, others say it's little different than what al gore did. far different from talk in stocks. >> yes, it is. it's easier to read the transcript and have less rancor. i think some people would have said this has always been his position in building over time that the election is rigged. this seems to be in keeping. in terms of what we need to see, i think a somewhat articulate depiction of something that dan
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dimicco talked about in "squawk box" a few minutes ago which is the job loss on nafta, without a common discussion by hillary about what is gained from nafta. i keep missing, i keep waiting for the actual economic discussion as opposed to the concept about this election dragging on. those of us who went through the period where trump -- i'm sorry, where gore fought on. >> right. >> it did seem pretty right. it went to the supreme court, which took forever. and the popular vote was such that it was -- i understood why it was, but did not help the stock market. >> yeah, what was stocks reaction? >> you couldn't make decisions about where things were going to go because the two candidates were very different. i remember trying to figure out coal. i mean, coal was actually a very big thing back then. >> sure. >> because al gore was already at the forefront of global warming, or you could say he was
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backing some ruse that was global warming, but when it comes hoping put election past us and make decisions that was a tough call by trump. because i think there's a lot of people whether it be if you're buying drug stocks, if you're buying bank stocks, if you're buying pipelines, i mean, you know, i'm now getting to speak to a lot of people in the energy industry. they believe that this is a seminole election, that there will not be anymore pipes built. and that the fossil fuel will be something you can't invest in. those are the three big areas that people want this thing resolved. >> so you don't necessarily see it as a negative if for whatever reason the contest, the election is contested at length, is it just -- >> it's just an abeyance. i think the problem with an abeyance -- we have the highest cash positions in 16 years. there's lots of people who wait for this thing to be resolved. and a bull wants this thing resolved either way at this point. we just don't want -- we don't
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want -- we want the decision to have -- to just be done. anything that elongates the decision would be something that would cause a lot more concern than we have right now. >> sure. for more on last night's debate we want to go to our chief washington correspondent john harwood who is in las vegas. good morning, john. >> good morning, carl. you know, donald trump began the debate doing some of the things that he's done well at times. he spoke in a calm demeanor, he talked about the issues, whether it was on the supreme court and abortion rights and gun rights to economic issues as well. but hillary clinton did what she did well at the same time and ultimately that undid trump. she needled him. she said he had choked when talking to the mexican president about the wall. she said he was a puppet of vladimir putin. she said he'd used foreign steel and undocumented immigrant workers in his buildings. and finally, when she went after him on not paying taxes, the
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candidate who is now behind by 20 points among women in the polls, couldn't take it and said this. >> i am on record as saying that we need to put more money into the social security trust fund. that's part of my commitment to raise taxes on the wealthy. my social security payroll contribution will go up as will donald's assuming he can't figure out how to get out of it, but what we want to do is to replenish -- >> such a nasty woman. >> now, that was an unfortunate moment for donald trump, but even more unfortunate was this exchange that you played a sound from earlier that transcends all the issues in the debate. he got repeated chances from chris wallace, the moderator, to affirm the results of a free and fair election in this country, he simply would not do it. >> do you make the same commitment that you will absolutely -- sir, that you will absolutely accept the result of this election? >> i will look at it at the
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time. i'm not looking at anything now. i'll look at it at the time. >> now, that's a different answer than his daughter ivanka trump had given, his vice president mike pence had given, his campaign manager kellyanne conway had given, and it divided him from mainstream republicans all across the country who've said this is going to be a fair election even if there are sources of media bias and other things that donald trump has complained about. if you look at this poll by cnn after the election, it shows that by 52% to 39% viewers thought that hillary clinton won the debate. now, that's pretty close to the ballot, which is an indication that if you're already for trump, you thought he did fine. if you're already for clinton, you thought she did very well. the problem is a lot more people went into that debate being for hillary clinton and donald trump from all appearances or all conclusions we can draw right now made no progress in closing that gap. >> yeah, you made the point last night maybe we are just down to partisans at this point.
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john, the gore comparisons that we talked with jim about a moment ago, are they fair or not? >> no, they're not. the al gore situation dr fir-- of all, that election was not rigged either in its initial -- the wait it was staged initially or in the supreme court's verdict. what cost al gore florida was the design of the ballot in palm beach county. that was the simplest explanation. but in reality what we had was an election that was simply too close to call and a candidate who had initially conceded in the belief that he'd lost then realizing that there was a recount situation in florida, withdrew the concession and we had the recount. it didn't go his way, he accepted the result, he helped heal the country by embracing the idea that george bush had legally constitutionally won the presidency. that's what donald trump unlike many other republicans decline
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to commit to last night. and it's why that's the biggest story of this debate. >> we will see how fellow republicans respond to that after the likes of laura ingraham tweeted, we'll see if senate majority leader, speaker of the house have similar opinions or not. >> if it's a really close race and something happens that is like what happened with gore in florida for trump, then i totally understand his desire to contest. i remember it was day by day and we couldn't figure out the hanging chad and it was not clear and florida was on the line. you get a really close election, a popular vote very close, i would totally understand trump's position, but not if it's not close. >> right. now we're talking about point spreads and what stretches the bounds of fairness. >> yes. >> in a point spread. >> yes. i would say for hillary the same way. but there were mechanical issues in that florida election. i remember because i researched -- because of my job, because i was a hedge fund manager. i was like we have to figure this out. there were so many issues on the
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line. i understand, look, it's not -- gore never thought it was going to be rigged, but i thought gore -- it was very unclear who won in florida. >> our thanks to john harwood. we'll hear from john later on this morning. meanwhile earnings mixed reaction to components, am ex up sharply and verizon beats on the bottom line, misses on revenue amid what it calls a challenging environment. and then travelers falling even though quarterly results beat forecast operating profit down 24% despite premiums, jim, which were at record highs. >> yeah. some of these really whether it be travelers, union pacific, really got to drill down to the conference calls. i'm always reluctant because insurance is such a hard business to understand. and it's often certain line items that really do matter. so holding travelers in abeyance, remember they buy back a lot of stock that can impact things. america's best was clear beat up, a lot of people felt costco losing that business to visa
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city would citi, would be a terrible thing. but i think the growth was much more robust than i thought. again, on a conference call they can often explain what went wrong. so there's a lot on the line in what companies are going to be saying witness the fact that when united airlines reported the number looked bad and then, boom, people wanted to buy because they called bottom. phil lebeau, when you have american airlines coming back big, halliburton conference call really good, conference call has been important than printed numbers what i'm saying. hate to make judgments. >> amex, able to absorb the costco blow? >> yes. sometimes you just got to say, look, i own the fact that i had been negative on this -- 25 points, i felt really good about it. i overstayed my welcome on the negative side revenue growth plus two they really did accelerate numbers. they're doing a lot of things that are finally investing. i thought it was interesting.
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i don't know if you've been to a senturion. >> high end cards is what it's about, right? >> yes, i always thought why can't there be a great lounge, i found out because i was a platinum member. this is happening. it's a pilot project, but i'm impressed american express has finally gotten past this and finally start spending. a lot of us felt it could never get better and it just did. >> finally on verizon, postpaids down in q-3 for the first time. >> that was really a disappointment. a lot of people looking for 875,000. you know, look, i'm going to tell you when i see the actions of what sprint and t-mobile are doing, they're so aggressive that it looks like it really cut into verizon this time. they have really launched price wars. and when you -- take the guy from verizon, the actor, and put him in the ads, you knew that the gloves are off in this
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business. and they are very different kinds of executives. we're used to seeing those guys like larry ellison trying to beat up marc benioff, who by the way off camera are friends. i don't think there's any friends -- there's no love lost between these guys. i'm waiting for ledger to weigh in. on twitter i'm waiting to see who's dumb and dumber, maybe wants to see att's numbers first. finally 90,000 high speed customers added which you're going to need if you're going to subscribe to the new google television service. >> i think google is finally starting to see one of the reasons google went to all-time highs, finally seeing this youtube. i've been waiting for youtube to be worth the price of the company, ruth porat often talked southerubtly about underappreci assets. youtube is probably most underappreciated asset, we thought this could happen a long time ago, now it's happening.
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>> we can't wait to get to a lot more. we'll get to e-bay, tesla, dunkin, a bunch of airlines and more reaction of course to last night's presidential debate. also ahead, elon musk betting on that new driverless strategy over at tesla. we'll fill you in. take another look at the premarket. dow and nasdaq finally managed a two-day win streak. the first of the month. three days in a row would be the first time in about a month. we're back in just a moment.
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woman: how do we protect them from $4 billion in new cuts to california schools?
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man: vote yes on proposition 55. woman: prop 55 doesn't raise taxes on anyone. man: not on working californians, not small businesses. no one. woman: instead, prop 55 simply maintains the current tax rate on the wealthiest californians. man: so those who can most afford it continue paying their fair share... woman: prevent new education cuts... man: ...and keep improving california's schools. woman: vote yes on prop 55 to help our children thrive.
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tesla announcing a driverless strategy. the electric carmaker says all of its new vehicles will be equipped with hardware that enables fully autonomous driving. tesla adding it plans to have a vehicle drive itself from l.a. to new york by the end of next year. fascinating call with musk who essentially said the media is killing people by nitpicking at all the pilot and keeping people away from that. safer, he says, technology. >> it's funny because i want to hear what travelers had to say. travelers got concerned about the pick up in auto fatalities because of texting. and that's definitely clear. we've reached a bottom in fatalities and we're going back up. i have learned to respect a lot of elon musk is doing,
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driverless cars, he's well ahead of everybody else. but that is different from the financials of elon musk because they're tied up with solarcity and that's a deal i don't understand. i'm on jim chanos' side. scott wapner fifth anniversary, love it. i think you have to distinguish between the financials and the forward looking analysis that jay leno taught us frankly when he was here. i mean, i want one of those cars. i want one for my kids. and not that i expect they'll be doing anything texting or -- but there are too many kids who are texting. there are too many kids who are doing the wrong thing. and this would be a lifesaver if he pulls it off. >> it's true. actually road fatalities are starting to tick up again. a lot has been blamed on texting. >> not enough talk about that. i know that dan hessy when he was running sprint said are you aware of texting has turned around fatalities? i was not. that was about five years ago. and then the late ceo of travelers told me the same
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thing. >> you trust the technology and the mission, but you don't trust, what, the capital it's going to take to get there? >> well, i don't know, i think it's expensive because i got time to spend -- i got to sit down with ford, with mark fields, at their driverless center in the valley. you know, you're talking about 2 million sensors, you're talking about a huge number of semiconductors, a major expense. i don't know whether you can keep that car price down. but i respect elon musk's vision even as i don't like the solarcity deal. >> we'll pay a lot more attention to tesla today. we finally got that surprise announcement, as he said. we'll get cramer's mad dash, count down to the opening bell in a few moments. taking another look at the premarket, haven't had a four-day run since july for stocks. and only one triple-digit day for the dow in the past ten. back in a minute. ♪
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no matter how lame they are. well said, ann. i've always admired how you just say what's in your head, without thinking. very brave. good point ted. you're living proof that looks aren't everything. thank you. welcome. so, fedex helped simplify our e-commerce business and this is not a passive aggressive environment. i just wanted to say, you guys are doing a great job. what's that supposed to mean? fedex. helping small business simplify e-commerce. theno one surface...out there. no one speed... no one way of driving on each and every road. but there is one car that can conquer them all, the mercedes-benz c-class. five driving modes let you customize the steering, shift points, and suspension to fit the mood you're in... and the road you're on. the 2016 c-class. lease the c300 for $369 a month at your local mercedes-benz dealer.
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♪ just about eight minutes until the bell. let's get cramer's mad dash. couple consumer names going different ways. >> yes. start with e-bay. now, you're going to see the stock dramatically weaker. even though most analysts defend it today, you did not get this core gross merchandise value doing better, decelerated moderately, stubhub 23%, i love stubhub and i think a lot of us do, but deutsche bank says the losses in the stock are overblown. that's pretty much the commentary. my problem is when active buyer growth decelerates, then you are really looking at a company going to have to spend a lot more money to replatform,
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replatforming takes a long time, getting more mobile, trying to get younger people in, it's going to be a rough slog now. it really did kind of wipe out a lot of that gain from the last quarter. i'm not sure. i think the analysts are trying very hard to prop it up, but it could be a little bit here in purgatory. >> meanwhile, mattel. >> wow, mattel, a lot of people -- i remember sitting down with mattel people at two years ago at dream force, they've gotten very much involved in customer retention trying to figure out what people really like. you know what they like? they like barbie. barbie up 17% and american girl up 14%, fisher price up 6%, this is really terrific. to have both mattel and hasbro doing better, traditional toys kind of a throwback even though activision, electronic arts, maybe everybody plays, they play, they watch netflix. when i work i feel like such an old -- i'm a dinosaur. i'm a t-rex, i go to work, i
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study, i don't do any of these things. but mattel fabulous quarter, very much in touch with the quarter. >> by the way on with the future of gaming evolving into tv shows, e-sports. >> i have been saying for a long time, for instance, to take two, visionary, these are all -- every one of these could be movies, they could be netflix movies. this industry is really smart. 11% of the time americans spend gaming. gaming. i mean, i feed the dogs. >> yep. >> i work. and then i let the dogs out. and then i work. >> maybe if you got up a little earlier, you'd have more time to play games. >> 3:55? i mean, i don't know. i had to start 3:15 i'm going to play call of duty and then grand theft auto. i don't know, war craft and whatever else. there's a new tank one, tank battle, that looks interesting to me. how do people do it? >> anything to distract us from the issues of the day, i think,
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is a big part of it. >> great to go to. and then read the debate -- watch my version multitask is to see salt and pep pa and to see the fabulous alicia keys from voi"the voice" by the way who i fabulous. >> you had good shots on twitter last night. we'll get the opening bell in a few moments. don't go away.
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you're watching cnbc's "squawk on the street" live from the financial capital of the world. the opening bell in just under two minutes on this thursday. investors responding, reacting to the debate last night. ecb rates unchanged, claims a little elevated 260. >> yeah. i'm looking at some of these manufacturing earnings a little disappointing. illinois toolworks hasn't disappointed in years. they're a little more tepid. i thought that was interesting. union pacific as i mentioned not as robust as i thought. some of these companies had made you feel a little better about american industry. boy, it would be really interesting on trump and free
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trade versus fair trade what it would mean because you take a union pacific. union pacific has fantastic business with mexico. i thought better in auto, didn't happen. a lot to dig deep but this is not that positive of a day in earnings so far. dunkin not that good. >> a lot of bottom line beats but not nearly as many -- >> exactly. i felt that was dunkin with traffic. really have to watch today because we had a very positive setup when we thought we came in with american express, the travelers combined ratio now looked at what they make after not so hot. but kinder morgan, we haven't mentioned that, they're talking about raising the dividend, a scarcity of pipe if hillary wins, kind of gotten more interesting. i've not been a fan ever since the big dividend cut, but it's mixed today, it's not great. it's mixed. >> reports that deutsche could see some middle eastern or chinese investors boost their stake. >> i do not want -- i think people who are short deutsche are waiting for a big rights
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offering, that could still happen. but remember, it's the justice department versus deutsche. it's not deutsche and, but you'd like to think they have some capital. >> there's the opening bell. and the s&p at the bottom of your screen. at the big board, mcquary infrastructure, gas power and energy businesses. at the nasdaq, exl, an operations management and analytics company celebrating its tenth listing anniversary. again, i think it was citi yesterday big note on infrastructure and how much demand could be created over the next ten years. >> i'm still -- i'm still reeling. toipt make a point because i had been very critical of him. i am still reeling from what happened at cat with doug oberhelman. i think their company -- doug oberhelman led that company to some bad decisions in 2010,
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2011, but he has fought the tide. and it would be really -- it would be sadly ironic if infrastructure starts to spend -- if they finally start spending just when doug is not allowed to take advantage of it. he's kept that -- jim chanos was negative about cat in terms of estimate cuts. i realize doug went through the worst possible time and now they usher him out. doesn't seem right to me. >> yeah. >> doesn't seem right to me. >> that would be tough timing. >> yeah. >> a lot of consumer names today, dunkin beats by two cents. fewer store openings and some weakness at baskin. >> yeah, the traffic not that good. i have to tell you, i don't know whether people are going to read through on starbucks. you know, yesterday kelly evans -- howard schultz talked more about international. dunkin wasn't that good international. there's another one where the stock really ran thinking that things were better than expected. the ones that run better than expected are not doing that well so far this quarter. dunkin i am surprised it's that weak. that might be a bit of an
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overreaction. >> we got dudley on the tape last night, he spoke again this morning. dollar index by the way he's saying some time this year, again. dollar index near the highest now since march. >> yeah. i've been looking at that dollar/euro. i mean, they got that thing back again. i have to absolutely just tell people that if you're in an international -- a company that does international work, it's going to flip again. you're not going to be that happy with what these analysts can say. only real industrials delivering a very good quarter. but they almost never miss and did a restructuring that was fabulous. very, very mixed day today. very. everything's being put through the election prism. holy cow it's hard. >> yes. airlines, we do have american beating by 11 cents at 220. alaska beats 220 versus 208. >> you know, i've been -- remember, these stocks have had gigantic moves. but i tell you if the airlines
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come back down, and i don't think they should come back down that much -- look, american selling seven times earnings and i think these are tough quarters. soft quarters oil service, these were two groups really beaten up and they are attracting new money. if american comes down, you maybe look at the group. but united, continental is cheap. osc osc oscar munoz changing the operating file. it had been a poorly run airline. i spend a lot of time unfortunately traveling and i think people who work for united now are joyous. it's incredible. they're joyous. i know you can say it's anecdotal except i've been on like 40 planes this year and i'm tired of it. >> united's had a tough run when it comes to customer service. >> oh, has it ever. i am telling you in the airline business customer satisfaction matters tremendously. >> we haven't gotten to wba,
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beats by eight cents at $1.07. comps up 3.2, that's one of the gainers. >> that's amazing. my travel trust owns it. i looked at the numbers, every single category i didn't like. revenues i didn't like, didn't like same store, didn't like the gross margin, but they said they can get this rite aid deal done. and if that's the case and numbers go up big next year. i have felt rite aid cannot get done because of the ftc. they give you hope it can get done and analysts will like it if they can get that deal done. >> although the timeline now delayed. >> yeah, but at least not killed. i mean, anybody who is involved with what happened with safeway, albertson's knows safeway they spun off a bunch of stores, it failed. so the ftc is saying, listen, you got to get a real buyer of these stores for rite aid. if they get a real buyer, it didn't look like -- i thought kroger would do it, but they didn't. if they get a real buyer, people are going to love walgreens. keep in mind this is really a story about the ftc. think about how many situations
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we have that's really about the election. >> really good point. >> justice department is deutsche bank, not earnings of deutsche bank, ftc is walgreens -- >> wells california county prosecutors. >> the government is everywhere. sometimes you sit back and say who do i get the fact the government has intruded in a lot of different places. then again, someone might say, listen, you cannot have a one grocery store cap. where my daughter lives, she was next door to a safeway turned into a hagen because of the ftc, it's now bankrupt and it's shuddered and now you have to go to the more expensive place or co-op. i don't know, i look at my bill, i wish that that hagen stayed open. >> we talked about china yesterday regarding starbucks. today imax is up almost 8%, a big china play. >> i've been waiting for that. he's done so much to try to give you a china situation. a lot of people part of this stay at home theory is that the
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cinema that these places have gotten too expensive. >> right. >> but he does offer imax, which is something you can't get at home. look, the day that best buy offers you imax at home, we're not going to imax. but that seems to be a real mode. >> you need a big house. >> do you think spielberg has imax? >> need a big house to create your own at home. >> wouldn't that be something? >> yeah. overall 19 days to get through the election. do we move very far from these levels either way? >> i think that the decision by donald trump to surprise us with whether we contest it is going to put people more on tender hooks, but it's about the house and senate. and if you start seeing more gr granular polls which says there's going to be a sweep, you're going to see money come out of the drugs, come out of the banks, come out of the fossil fuels. it's just going to come out. because you can't risk a sweep. it would be bad for stocks a sweep. i'm just putting it out there. >> yeah. >> you may like infrastructure,
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but the number of companies that benefit from infrastructure, caterpillar, vol can materials, far outweighed by the number of companies in the drugs and banking group. and oil, oil service, that would really be hurt in a sweep. there's no doubt about it. it'd be really hard to build a pipeline in this country. >> some discussion this morning about say the polls come in around here there's a big difference for congressional seats whether it's a four-point spread or something wider than that. >> oh, yeah. i don't know if people are ready for a sweep. i don't know if they're ready for proposition 61 in california. if that happens where they're going to try to squeeze the drug companies. look, the drug companies price-to-earnings multiples have been slunk here, but a sweep means you're in the wrong stocks, wrong stocks. >> with all that dow relatively muted action to start the day, down ten. we'll get to bob pisani in just a couple of minutes. by the way, we're going to get existing homes, philly fed 9-7
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some of these regionals have disappointed. >> yes, they have the remember the gross domestic products numbers, revision down, revision down, revision down. housing, housing has just gotten so hard to declare, but i can fell you we remain as say in toll brothers and lennar, we are still building half as many homes as we used to. and that number has not bounced back. there's more multifamily, but remember we used to build more homes when we were 150 million people than we do now. that's rather extraordinary. >> you think the home ownership rate is too low now? >> yes, i do. >> gilbert on this morning saying, obviously generational low. >> yes, because i think combination of student loans and the inability to get credit although this quarter we're seeing a little ease, but fico scores are so high those rates that are available are not available to many people. >> so we swung from the top of the peak, '06, '07 and we just crossed through the sweet spot in seven years? >> also we don't have the
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demographic growth we used to have. something happened to childbearing during great recession. we do not have that growth. also of course immigration's come back. one of the things in the debate was at one point donald trump said millions of people have been shipped out -- i don't know the numbers, but i would say that immigration and lower birthrate have really hurt the demand. and plus it's very hard here we go regulation. there's a lot of areas where we used to be able to build. you can't build anymore. go listen to toll brothers, california, the average single -- look, the starter homes are $1.3 million in california. >> yeah. >> it's really insane. so housing some places are just too overpriced. new york's coming down in the $20 million bracket. >> if your score is not pristine and you don't have the 20%, you can forget about any financing. >> i know. i periodically hear there's a credit boom again. i mean, are you kidding me? try getting a loan from a bank. i've got a pretty good -- not to be too anecdotal, but i have a
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pretty good balance sheet and they're not moving for the beach home. they don't like the beach home. they don't want to make that beach home loan. >> i assume you're looking at jumbo's on a secondary -- >> let's say cash is king in that business. >> dow now down 40. let's get to bob pisani on the floor. hey, bob. >> good morning, carl. sort of a mixed picture in europe. little confusion about mario draghi's comments. take a look at germany, sort of a v here, that's when mario draghi was speaking. he did say they left rates unchanged. it's not clear what's going to happen with qe chrset to expire march of 2017. draghi did say they would extend if needed but didn't say they would or say they would begin tapering. did say extraordinary policy can't last forever. that may be a factor why we saw the market drop a little bit. but you see the v-shape, the market is confused by what draghi's intentions are. let's talk about the united states here because we're being dragged down by industrials right now. so health care, financials start the day to the upside, consumer
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staples down, industrials down that's because we've seen some weakness in union pacific and railroads but as well as some of the industrials reporting like illinois toolworks. all of you know i love big global industrial companies and illinois tool works is one of the biggest in the world. they make automotive and food equipment and adhesive and sealings all over the world, they know a lot about what's going on. eps beat, guidance, midpoint below consensus here. put back that full screen. organic sales up 1.6%. that's the problem. we are not getting much in the way of any real growth out there. it's a one to two percent world, so sluggish and no real acceleration. this is i think going to be a problem for the industrial names. and i think it's going to be a problem for a number of them including general electric which might be reporting tomorrow. so put up illinois tool works, the chart, this has been fabulous this year. this is one of the great companies for managing a lot of disciplines across a lot of platforms, 20 times forward earnings, up about 20% this
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year, but the sluggish growth is going to be an issue for them i think going forward. textron, more u.s. focus, we're talking about aircraft and defense, they had earnings out revenues okay for aviation. that's beach craft and cessna aircraft, but they have bell helicopter, revenues were light, they make techtron systems, that's big defense systems revenues light there as well stocks trading up a little as you can see here but hasn't been a big perform every overall this year. where are we on the earnings picture? we're waiting to tally this morning's results into the s&p 500 estimates. but as of the close yesterday right now earnings up about 0.5%, revenues up 2.5% overall. and we are on the verge of turning positive. we're only about 15% through the s&p 500. but we are certainly starting off well. ipos, we got one today at the nasdaq. and it's an interesting one. this is a company that does infrastructure project, this is very much in the news right now. they do water projects as well.
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infrastructure for water systems, 18.4 million shares at $18. that's disappointment, price talk $19 to $21. this will open at the nasdaq in about 45 minutes. see how that one does. where are all the ipos? we've been talking about how well the markets have been doing. generally the last few in the last few months have done well. zto express, chinese delivery service, essentially the u.p.s. of china, 72 million shares, 21 to 24, do the numbers, you're talking $1.4 or $1.5 billion offering out here. this would be the year's largest ipo here that a chinese company is offering here. finally another big one next week, accushnet, 21 to 24, but overall, carl, i don't know where the ipos are. we've had a good market, we've had good ipo results in the last couple of months and still you would think they're pounding down doors going public particularly with the election in front of them want to get it
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out of the way. it's not happening right now. >> still a little runway if you want to wait perhaps. thanks so much, bob pisani. oil prices are not holding up back below 51. let's get to jackie deangelis. >> good morning, carl. that's right. oil retreating this morning as you mentioned under $51 a barrel. november is going to go off the board this afternoon at the close. everybody is really focusing on the december contract which hit a 15-month high yesterday just around $52 a barrel. so it's no surprise that we're going to see some profit taking here and some technical selling as well. remember, a lot of traders don't think there's much more room to run in these higher prices. so it's difficult to get that price higher than we saw it yesterday. and they're telling me that they expect this pattern to continue not only until the election but through the end of november until we get more information out of opec. that uncertainty is going to create a seesaw like pattern we're quite used to when it comes to oil prices right now. but also there's some confusion on the supply and demand front. inventory numbers especially out of the u.s. have been going the opposite of expectations. the optimistic view is that
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maybe demand is picking up, but the more cynical view is that it probably wouldn't do so so quickly. so people are looking for some clarity. but say a dollar index over 98 is certainly a problem today for crude as well. going to cause some pressure. and of course we're watching nat gas inventories, carl, 10:30. i'll see you then. >> all right, jackie, sounds good. when we come back, hear what one well-known ceo is saying about the election and who he's backing in the race for the white house. dow's down some 20 points as jim said on a fairly mixed early session. back after a break.
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stop taking cialis and get medical help right away. why pause the moment? ask your doctor about cialis for daily use. and for a $200 savings card, go to starbucks ceo howard schultz weighing in on the presidential election. this is what he said last night on "closing bell." >> i'm very enthused and excited about hillary clinton becoming the next president of the united states. she's the most qualified person. and i think given the divide and
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how vitrealic the campaign has been, i look forward to the campaign being over and hillary clinton being the next president of the united states. >> seems like a lifetime ago people were talking about howard himself going into politics. >> well, i think some of these wikileaks have suggested that howard might have been more involved. i think howard in many ways is committed to seeing through starbucks. look, i think at a certain point i think he looked at himself and said, you know, donald trump through tweets, through business was able to raise his profile, maybe howard should too. but i think a democrat who didn't want to let's say overthrow hillary to a degree. but i agree with him i can't wait for the election to be over. >> yes. >> i just can't wait. holy cow. >> wallace even made a joke last night about clinton and trump probably grateful they don't have to appear on a stage together again. >> geez, i want to go back to when people watch football. remember? the ratings story by the way, may be something bigger than we think. there was a note today positive
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about cbs, but is there a secular change there? i don't know. >> thinking about andrew ross sorkin at the vanity fair new establishment summit yesterday talking to moonves, who said he was surprised. he has been surprised not at the regional games, not at the sunday afternoon games but thursday night football, sunday night, monday night. >> tired night football. those thursday night games the home team wins, the away team, they're not ready. i spent a lot of time talking to players in the nfl, the athletes aren't ready, but the nfl wanted the money. i think also the fanduel, that whole craze seems to have diminished. but i think it's something to watch because the nfl is a huge business. a $5 billion business. and everybody who's ever affiliated with it has done fantastically. it will be interesting to see. visa, pepsico, nike, talking about mcdonald's, you're really -- by the way, you're talking at surface. >> yeah. >> microsoft. so just be aware, i don't want
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to diminish the story of the nfl. those numbers have to turn around. >> i was just thinking cbs was early and moving to streaming, especially on news. >> right. >> and now if these reports are true that they're the first sign-up for google's unplugged, another first strike. >> well, we have seen this alphabet google go up and up and up all time and it's done it very quietly. of course fang, two fangs are facebook, amazon, netflix, google and also diamondback energy. fang versus fang. that's where all the growth is. facebook was over 130 this morning and gives up the gain. i don't see any reason -- these are the hot stocks. but this market i think is suffering from last night. i think people just think, wow, maybe this thing is a little -- not over until it's over. >> by the way, did you see trump's live news show on facebook prior to the debate? >> that was an interesting way to do it, he had 100,000? >> easily. couple hundred. >> i just think if you're in
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this industry, you're going up against facebook, google's getting really serious about youtube. it was only a matter of time. i mean, they had so opportunities -- cfo there my favorite cfo, i think she came there and instilled a level of discipline and really starting to hit all cylinders. people wrote that company off, they had a below market multiple on next year's earnings, that's kind of crazy. >> she's one tough ceo. >> whoa, she is tough. that's one of the reasons why i think she's fabulous. >> we'll get stop trading with jim in just a moment. and if jim's point is right about the market truly not knowing what to make of last night, the dow's down three points. back in a minute.
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♪ time for cramer and stop trading. >> one of my absolute favorite companies ever since people bought summit i realized expedia owns the travel business, you basically turn your business over to expedia.
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they bought home away, another company i really liked and thought was a little underfunded, so to speak. they're killing it with it. looks like they've made home away -- this is a vacation rentals. that's an actually very good business. so expedia, kpeeep in mind trivago ipo, a very undervalued company, should be valued the same way priceline is, but unless you're in this hospitality business, you don't realize how powerful these companies are. they have revolutionized travel. you have nothing to do with cash. expedia books your rooms and you come in and you've got your money and that's how hoteliers do it. this expedia's undervalued. >> interesting. what's on mad tonight? >> well, we've got lam research. lam research was not able to complete that deal with bancorp. and a lot of people thought that deal was going to tank. forget it. her man miller, this is office furniture. and sky works, you're not allowed to talk about apple,
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largest customer ever, but cell phones -- i know right now apple is kind of hung up by this new google phone, but i continue to believe things are in short supply. apple will do best to fight out of sky works, but these are three guests that can control tomorrow. i'm not kidding. what a day today. this is a very confusing day because if illinois tool works is down and danaher's up, you can't group industrials today. >> yeah. not in macro trade. >> no, you can't. >> jim, we will see you tonight "mad money" 6:00 p.m. >> thank you. >> when we come back, more reaction to the debate last night. dow again in a tight range up less than six points.
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♪ good wednesday -- good thursday morning. welcome back to "squawk on the street." i'm carl quintanilla with sarah eisen live at post nine of the new york stock exchange. david's off today. markets muted action this morning. dow up about 16 points, s&p basically unchanged, oil is back below 51 as we have a lot of earnings to get to and reaction to the debate last night.
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>> some economic data crossing the tape right now. diana olick joining us with those numbers. hi, diana. >> hi. existing home sales in september up 3.2% to a seasonally adjusted annualized rate of 5.47 million units. that's a beat. the street was looking for flat and we got a 3.2% monthly gain. sales now up 0.6% year over year, back in the positive annually. august was revised down slightly, but not a lot. the trouble in the market, inventory. not improving. 2.04 million homes for sale, that is down 6.8% year over year. the realtors saying it is, quote, a meaningful decline because inventories should be rising in the fall. and the chief economist saying that the spring market at this rate will be, quote, quite heated, which means great for sellers, not so great for buyers. it is also pushing the median home price up $234,200 in september. that's up 5.6% year over year. we're also seeing a rebound on
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the very high end, that is sales of homes priced over $1 million up 12% year over year. and good news on the first time buyers. 34% of the market it's still below normal levels, but they are returning here. that is the highest level of first-time buyers in four years. so 3.2% gain, the street was looking for flat. back to you guys. >> all right. thank you very much, diana olick. get to our big story this morning, the final face-off between republican nominee donald trump and democratic nominee hillary clinton moving quickly from policy to personal jabs. our john harwood is in las vegas and joins us with the highlights. good morning, john. >> good morning, carl. i want to start with one element of the debate that's gotten slightly less attention than others that are higher profile, and that is when the issue came up of the wikileaks e-mails that have been disclosed from hillary clinton's campaign chairman john podesta. chris wallace raised the point and donald trump underscored that point that they show
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hillary clinton discussing issues like trade in a more centerist way privately than she was publicly. donald trump trying to hammer her for being not trustworthy in what she says in public. that's a vulnerability of her in the polls. she, predict blably tried to pi back to who hacked those e-mails and who released them. u.s. officials and intelligence community believe russia did. but donald trump unlike his running mate mike pence was not willing to accept that evidence. listen to this exchange. >> she has no idea whether it's russia, china or anybody else. >> i am not quoting myself. i am quoting 17 -- >> hillary, you have no idea. >> 17 -- do you doubt 17 military and civilian agencie agencies -- >> yeah, i doubt it. >> he would rather believe vladimir putin than the military and civilian intelligence professional who is are sworn to protect us. i find that just absolutely -- >> she doesn't like putin because putin has outsmarted her at every step of the way.
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>> donald trump was challenged on that by the moderator, chris wallace, as well as hillary clinton. and she continued her practice of baiting him, needling him throughout the debate. she said he would be a putin -- excuse me, a puppet of vladimir putin. she said he had choked in a meeting with the mexican president. she said he'd used undocumented workers and foreign steel in his construction projects. and finally, when she raised the issue of him not paying taxes, he couldn't take it anymore and said this. >> i am on record as saying that we need to put more money into social security trust fund. that's part of my commitment to raise taxes on the wealthy. my social security payroll contribution will go up as will donald's assuming he can't figure out how to get out of it, but what we want to do is to replenish -- >> such a nasty woman. >> such a nasty woman, an unfortunate line for a candidate
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who's behind by 20 points among women. of course that was overshadowed by an issue that transcends all issues in the debate and has divided donald trump from the rest of his party, his running mate, his daughter and campaign manager, and that's the issue of is he willing to accept the results of the election on november 8th? >> do you make the same commitment that you will absolutely -- sir, that you will absolutely accept the result of this election? >> i will look at it at the time. i'm not looking at anything now. i'll look at it at the time. >> and of course that has become the dominant story coming out of this debate. bottom line, look at the cnn post debate poll, 52% said hillary clinton won, 39% said donald trump won, that's very close to their voter preferences on the ballot. both sides were reinforced in their views, but the problem for donald trump is he's behind. he needs to win new converts, not much reason to expect that he did that last night, guys. >> john, that's a good setup. thank you very much. our john harwood joining us this morning here at post nine with
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some reaction. former clinton white house aide keith boykin and larry kudlow, you guys work so well together, it's good to have you back. >> i love him. i just do. >> larry, i love that sound bite that john played because in another world we would talk about tax policy with you this morning, but nasty woman buries it all. >> i don't think it buries much as not accepting the election returns. i think that was a major blunder. what troubles me about that -- by the way, i think trump had a pretty good debate overall. i hope we'll get back to that. but what troubles me about that response is i think it might have been planned. and i think there's some people around mr. trump, breitbart, steve bannon, he's a friend of mine, i just disagree with a lot of his strategies. i don't think they should have gone there. she nailed him for it and of course the media's running with it, so you just have to accept that. i think that just buried the whole thing. there's nastiness -- >> what does that mean buried
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the whole thing? >> in my view he had a lot of good things to say. maybe incomplete on taxes. i want to get back to that. i thought he was very strong on the judges, very strong on the second amendment, as a pro-lifer i thought he stood up very well for that, the life of the fetus. i thought he nailed her on the e-mails. it's funny, my e-mail take on this is the most damaging thing for her was the revelation that her former undersecretary of state was trying to cut an fbi deal over these private servers. that really hurt. inside polling for example in ohio from some great pollsters you know of show that really hurt her a lot. so trump nailed a lot of that stuff, but this election results thing unfortunately is the headline. >> you agree, keith? >> i do agree about the election results part, that is the headline. and i remember after the last debate, the hillary clinton team came out with a video where they went through all of donald trump's statements and at the end they asked, does donald
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trump have the discipline to be president of the united states? and hillary clinton slowly picked up the microphone and said no. that's essentially what we saw last night, for 30 minutes donald trump was a relatively controlled candidate on stage. >> yep. >> and then the sedatives wore off and donald trump was the old donald trump again. he was a belligerent, indignant rude donald trump we've seen in previous debates. it did not play well after the first 30 minutes. by the time he got to the point of calling her a nasty woman, it was almost over because he had gone onto say that, as you pointed out, that he would not accept or was not sure he would be willing to accept the results of the election. we've never seen that before in a presidential election in america. that's what happens in tin pot dictatorships. >> i agree. there's no way i can defend that. i don't defend the indefensible with mr. trump. here's what really bothered me. let me just come back, the most important issue in the came pain, including the most recent
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polls, economy number one. jobs and wages. now, look, mr. trump got out some good stuff. she must have raised taxes across the board five times during that debate. trump said i'm a tax cutter. okay. trump said growth. trump said, by the way, one of the solutions to the debt problem is grow the economy at 4%, 5%, or 6%. >> he said 5% or 6%. is that real? >> of course it's real. i think that's exactly right. but he didn't sell it. can i just -- this is my disappointment, missed opportunity. he's putting more money in your pockets. she's taking money out of your pockets. he's in the tradition of jfk and ronald reagan whose tax cuts worked. she's way off on the left wing of the democratic party nowadays. he should have talked about his business tax cuts. she doesn't have a corporate tax reform. we need that desperately. there's a consensus. he didn't go into that how companies will stay here and not
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leave, money will come back on shore to be invested. and then he veered off -- it's weird. he veered off -- he started talking about south korea and germany and japan. and basically seemed to blame our economic ills on nafta. so i think he was off message and missed a really good opportunity to have -- look, he could have said, you know, on the fourth or fifth pass when mrs. clinton says i'm going to raise your taxes because we have to spend here and spend there, he should have said like reagan, there you go again. there you go again. but he just didn't get that out. >> could i say something on trade? because he did say to your point, larry, nafta was one of the worst deals ever negotiated and that's what's costing our jobs. why isn't she -- she could defend nafta. she could say the u.s. has transitioned from a manufacturing economy to the services economy ever since the '90s, that we've gotten all sorts of technology -- where's that defense of nafta which her husband signed? or is she just playing politics
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too much against his trade issue? >> that's a good question. that's a political issue to be honest. nafta is no longer politically acceptable by large swaths of the american public. it was in the 1990s bill clinton supported it, larry kudlow supported it, i supported it. >> i did. >> i think that the trade issue that bernie sanders and donald trump raised throughout the primary has resonated with a lot of people. that's an easy scapegoat for why they see economic woes. but when donald trump attacks president obama on the economy, i think he's missing the opportunity to go where the real target is. he should stick to the trade issue, not attack president obama. president obama's a very well liked figure in the country. he's got a 55% approval rating and people look at the jobs numbers and say for the past 78 months we've had consecutive months of job growth, 15 million new jobs. we haven't had a record like that in u.s. economic history.
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the president has a record he can be proud of, that's not an effective line for donald trump to attack hillary clinton. >> but, keith, i got a different -- from the bottom he had a big job rebound. on the other hand a lot of studies show we're still 5 million to 10 million jobs below the long-term performance line. and i give trump credit. he cited that this is the worst recovery since 1949. he got that out. he got a growth message out. he just didn't hammer away. like the business tax cuts. this is the first major small business tax cut in history. and that's a big job creator. and, again, it puts more money in people's pockets. the other thing he missed -- again, it's a missed opportunity. he didn't talk about regulations and burden of regulations, which is a very unpopular subject. >> he has gotten to it on the trail, but just not last night. >> right. just like he started out, he got some things in but he didn't really hammer it home.
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and i think he's got to because, carl, i think at the end of the day, all right, he won't accept the election results, these things will pass. people are going to vote their pocketbook. and he's got to make his pocketbook case. >> excuse me? >> they're going to vote their pocketbook. >> i have to disagree with that. >> almost no fortune 500 ceos, very little if any support him. >> they're even more unpopular than all these politician, the big companies. i'm saying this, look at the polls, e con, jobs, wages, number one issue. he has a strong growth plan, if i do say so myself. he needs to articulate it and sell it. he didn't get there last night. it was a missed opportunity. he did -- he got it out, but he didn't do enough to hammer it away. >> i think you completely misread the appeal of donald trump. i understand you're here, you're on cbc, you're economist, economic person, looking at it from a different perspective. but donald trump is not selling himself as a person whose
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primary value is about jobs and the economy. his primary value quite frankly is that he is a nationalist. the reason why he started his political career and became successful was because he challenged president obama's birth certificate. the reason why he started his campaign and became successful is because he called mexican immigrants rapists and drug dealers. that's his appeal. it's the xenophobic, i would say racist nationalist appeal. it's not about jobs and economy. i worked in the bill clinton campaign in 1992 and we said it's the economy stupid and that's been the message for almost every single election. but this election is different. this is not about the economy. this is about bigotry and nationalism. >> i understand that's your point of view. i respect your point of view, okay, we are civil with each other thank goodness. i'm just saying, look at all the polls. economy is still number one. by a substantial margin over terrorism and even obamacare, which i think he had some good jabs about obamacare last night too. i still think -- i understand your point. that was the starting line.
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but it is going to be about the pocketbook issues. that's where american elections are. this one's no different. trump had points last night. he just didn't hammer it home. >> so you expect him to do that in the next 19 days? >> it is my hope, it is my hope. that's all i can say. it's my hope. the bullets have been sent in. we'll see what happens with it. i'll say this, i was pretty rough on him two weeks ago after the billy bush thing. i think he could have done that better, melania -- he should have talked up melania's apologies and forgiveness, but i'll say right now as of this morning i intend to vote for trump. i intend to vote for trump. >> even after he says he will possibly not accept the results of the election? >> well, i hope it doesn't come down to that. >> but that's a possibility you're willing to accept? >> that was a mistake. i agree. >> it's a reluctant vote of support it sounds like. >> this whole election is an exercise in reluctance. everything. both sides. what are you going to do with this thing?
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>> i don't feel reluctant about anything with hillary clinton. i feel proud to support hillary clinton. >> i think it was peter heart months ago said it's a four-word election, they hate them both. they hate them both. >> i know. i dislike donald trump because i think he's unusual compared to every other candidate we've seen compared to republican party in history. but i'm not voting the lesser of two evils. i think she's a far better choice. i hate this false equivalence people continue with. >> i appreciate your point of view. i'm not voting on personalities. i very seldom do. i'm voting on the issues. to me he's the tax cutter even though he's not getting the message out. i'm just saying as of this morning i intend to vote for mr. trump. that's all. take it or leave it. >> we know who both of you are voting for. guys, thanks so much. larry kudlow, keith boykin. seen a little bit of a turnaround here in the market. maybe it's larry saying that 5%, 6% growth target is realistic. have a look at shares out of amex, dow reporting earnings topping expectations the company also announcing raising 2016
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full year guidance and reaffirming outlook for 2017. this report comes as the company looks to rebound from its lost costco revenues. the wholesale giant remember choosing not to renew its partnership with amex last year, carl. clearly this was a big vote of confidence, i would say. the results turning around from management. and i think investors heard going through some of the research notes this morning what they wanted to hear which was we're going to focus on the cards, we're going to improve the benefits especially on platinum because that seems to be where american express has lost market share. the chase sapphire preferred, have you gotten this card yet? >> no, but jim was talking about centurion lounges in the 9:00 a.m. and said he had personally overstayed his welcome on the negative side because people thought the costco would be such a liability. but clearly they've moved past it. >> yeah. amex certainly cracking down trying to improve those benefits. when we come back, stocks this morning trading higher, as i mentioned the dow up 30 points now, s&p right around the flat
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line. the nasdaq still negative but barely. we'll get reaction from the street with the election looming just 19 days away. and the man who led the charge behind brexit, european parliament member nigel farage, mr. brexit, making his way to last night's debate in las vegas. we'll get his take on trump, u.s. politics and of course the latest brexit outlook. he'll be joining us straight ahead on "squawk on the street." recently, a 1954 mercedes-benz grand prix race car made history when it sold
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welcome back to "squawk on
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the street." take a look at stocks right now. the dow is up about 23 points. amex is a big part of that story adding about 35 points to the dow. the stock is trading up 9%. it's also the best performer in the s&p 500. check out the u.s. dollar versus the mexican peso, this has become the proxy for how trump has done in debates in the polls after reaching a record low, the mexican peso back in september, it's rebounded and is now sitting at a six-week high against the u.s. dollar. little changed after the debate, but holding its highs as the market continues to price out the odds of a trump presidency. you know i'm watching that one, carl. >> yeah. when we come back, protecting your portfolio ahead of the election. charles schwab chief investment strategist liz ann saunders join us later on, nigel farage why he's backing trump and dow up more than 22. >> we have some bad, bad people in this country that have to go out. we're going to get them out. we're going to secure the border.
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and once the border is secured at a later date we'll make a determination as to the rest. but we have some bad hombres here and we're going to get them out.
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they came out with an anemic jobs report, a terrible jobs report. in fact, i said is that the last jobs report before the election? because if it is, i should win easily. it was so bad. >> jobs, the economy, taxes, topics front and center at last night's debate. for more on the market implications of this election we're joined by charles schwab chief investment strategist liz ann saunders. good to see you. >> hi, sarah. >> where are you on whether this uncertain election is having an impact now on how markets are trading and how the economy is performing? >> i'm not so sure it's having a big impact on the market. i think investor sentiment has been depressed for a variety of reasons. i think you can add the election to it. i do think it's having a bigger impact on corporate america. if you look at the nfib, national federation of independent business surveys, one of the questions they ask is about political dysfunction and whether that has been a factor in investment plans and decisions about the business. and that's gone absolutely
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parabolic. so i think it is having an impact no question about it. i think it's been one of the constraints on capital spending. now, the tests will be following the election when we at least have that certainty behind us whether you see a lift in that part of the business. and i think that's key for growth looking into 2017. >> i mean, a lot of it will depend on what happens to the congressional races. there's this view out there that a hillary clinton win would be friendly to the markets, but a democratic sweep would not be. if that does happen, if the chances of that do increase, if she can hold this lead, what sort of sectors do you want to avoid? and where do you want to be? >> i do agree. i think that probably the least unsettling outcome for the market which is largely what expected at this point would be a clinton win but at least the house remaining in republican control, and that's the checks and balances as it relates to what might be seen as the more economically damaging aspects to policy. in terms of sectors, it has less to do with the outcome of the election, but our view that we are not dipping into a recession any time soon and that you want to still have a cyclical bias in
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terms of exposure, we do believe that the fed will raise interest rates probably in december. and that has us with outperform ratings on both technology and financials. and we're a bit more cautious on some of the sectors where you've seen a lot of interests because of higher dividend yields like utilities and telecom. >> hey, liz ann, obviously the word stagflation is getting mentioned a lot more in media and on our air, but others say, look, people are coming back into the labor force, maybe the fed is smart to let things run a little bit hot. what's right? >> well, i think the fed has said they would like to see things run a little bit hot. i'm not quite sure we're there yet. pce, which is their preferred measure of inflation is still somewhat comfortably below their target it's running about 1.7. cpi is higher but that's higher because of the rank component and health care component. i do think they want to see it get closer to if not a little bit above their target. and we do think there is a small risk maybe of an inflation scare. but until the velocity of money picks up, the likelihood of an
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actual inflation problem i think is still somewhat low. >> i think you said you liked financials going into fed interest rate hike. are you worried at all about whether bernie sanders or elizabeth warren gets a cabinet position or some other powerful position if hillary clinton does win this election? is that a headwind for the banks? >> well, possibly on the surface. but again, i think it has more to do with the makeup of congress than it does the cabinet or whether hillary clinton wins. so i think that in terms of things like tax policy and regulatory policy, i think that's where the makeup of congress arguably takes on even greater importance than what happens in the white house. >> what about health care? which is now the worst performing sector year-to-date, the only one which is in the red and largely because of a lot of this political back and forth and bashing of the big drug companies. >> so we have a neutral rating on health care right now. and part of the reason for that given that valuations are actually pretty reasonable right now is political uncertainty.
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at this point we don't think you want to make a bet in that sector until we see the results of the election and the congressional races. >> if we see a trump surge into the next 19 days into the election, where do you want to be, gold, energy, what looks good? >> well, i don't know. you know, it's hard to judge. if you look at the correlation overall between the stock market and the betting markets to the extent there's validity there and you track it against clinton's move in the betting markets versus trump's move in the betting markets, there's been a much higher positive correlation between the market and the movement that clinton has made in the betting markets versus trump. so, you know, i do think some of the more defensive areas might take on greater importance. but one of the things we are cautioning about is do not try to trade around the results of this election because any time you make sort of a get in and get out decision or a decision about investing that is based on a single moment in time, that can be treacherous because you've got to make the get out and get in decisions exactly right. and that is a very, very difficult thing for investors to
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do. so we're -- our general message is don't try to game this from a short-term perspective in your portfolio. we think that will end up a losing strategy. >> yeah, we saw it in brexit. liz ann, thank you. liz ann sonders from charles schwab. when we come back this morning, trump support,er leader of the brexit campaign, nigel farage will join us. we'll get his take on the debate last night, the election, analogs to brexit and a lot more. stay with us. >> wait -- >> from everything i see has no respect for this person. >> well, that's because he'd rather have a puppet as president of the united states. >> no puppet. no puppet. you're the puppet. >> it's pretty clear you won't admit -- >> no, you're the puppet.
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good morning everybody. i'm sue herera. here is your cnbc news update at this hour. gunfire intensifying today around iraq's second largest city, mosul. iraqi forces are trying to retake that area from isis.
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iraq's prime minister saying the battle to take back that area is going more quickly than anticipated. in syria, medical evacuations are expected to begin tomorrow in rebel held eastern aleppo. the decision coming after the russians agreed to a pause in fighting. scientists at the european space agency are downplaying the loss of its mars lander. they say the probe sent back a wealth of data, which could help them prepare for a future mission. its signal cut out shortly after entering the red planet's atmosphere yesterday because it may have ditched its parachute too quickly. and the cleveland indians are going to the world series for the first time in nearly 20 years. and the fans are in celebration mode. cleveland beating toronto 3-0 in game five last night. the indians will host game one of the world series on tuesday. and now we'll await the winner of the cubs and dodgers series. cleveland has not won a world series since 1948. that's the news update this hour. let's send it over to jackie deangelis with the eia inventory
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report. good morning, jackie. >> good morning to you, sue. while the eia saying nat gas stocks increased by 77 bcf last week, that was in line with expectations just a little bit under what we saw this time last year and a little less than the five-year average but not really alarming. prices are staying flat on this report. remember prices did spike but down about 6% in a week or so with unseasonable temperatures we're seeing at least here on the east coast. but the colder weather is coming according to the weather models and we are expecting prices to stay over $3, traders say. they could move up from here, under $3 was a relatively cheap price. this is more seasonal, a little bit more fair. total stocks are hovering above the five-year average. so we are in good shape as we head into the late fall and winter seasons. back to you guys at post nine. all right, jackie, thank you very much. get a check on the markets this morning as you can see dow down about 40 points in a relatively tight range all morning long. what impact will the debate last night have on the markets? joining us this morning ubs
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director of floor operations art cashin. it's good to have you back, art. >> thank you. >> we always turn to you to help put things in some kind of historical context. media's making a lot of this comment he would not accept the results of an election not in his favor. you weren't thrown by it necessarily? >> no, i think he kind of hinted at it before. i think what the media is thrown by is they think he may come out pounding the table and leading to an almost insurrection kind of thing. i doubt he'll go quite that far. and the viewers should know that these two candidates are going to face-off against each other tonight at the al smith dinner. >> at the al smith dinner. >> that's a big opportunity for potential gaffe because you're supposed to be a little light handed, poking fun at your opponent and at yourself. somebody goes a little too far, that may make headlines tomorrow. >> right. >> so things are still there. this morning's been not so much about the debate but about oil. oil opened down, the market opened down.
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oil stabilized, the market came back. oil has begun to selloff again, so we're there. if the rally starts again, clear cut resistance in the s&p 2148 to 2153, and of course on the downside you don't want to close below 2130. that will be a second time, that will be a trigger for mr. gundla gundlach. we'll see. >> we also have ecb this morning, mario draghi in his press conference always sort of moving the markets a bit. but the upshot is you have the dollar index now at the highest level since march with the euro falling. how is that impacting stocks? usually that would be a headwind and we're seeing corporate earnings that strong dollar still pretty painful. >> yeah, no, it is. and i would suggest it also will be a topic at the fed because if they do go ahead with a december rate hike, that could spike the dollar even further. and that might wind up hurting -- >> you don't think it's priced in already? >> no. i don't. i think -- you know, you were up
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to 70% likelihood, and you've drifted back down in some areas that i look we're back to 50/50. so i would be a little hesitant about it. a lot of time to go. i don't think they possibly go in november particularly with the election being a wild card. and depends who gets elected and how it looks. they're talking about the republicans holding on to the house, but there is some debate as to whether paul ryan will get re-elected as speaker. >> quite a bit. >> yep. >> given his unfavorables in wisconsin. >> yeah. we have some very strange things going on here. >> earnings season, are you getting any clarity with the names we've gotten so far? >> no, i'm somewhat impressed that we've beaten on several areas, but i think maybe this is the pessimist in me that as the rest of the earnings come out we'll begin to slip.
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and i think this will be another quarter of an earnings recession, if you would. >> top line's been a lot noticeably weaker than the bottom, right? >> yes. continue. >> and the results we've gotten have resulted in people pulling in q-4 numbers at a pretty good clip. >> yes. well, particularly the atlanta fed and others. so, again, if the fed is really data dependent, i am hard pressed to see where they're going to move in december. so i think they're less data dependent and more reputationally dependent. >> one last thing, are you surprised that, you know, your first comment today about today's price action was about oil. >> uh-huh. >> are stocks not discounting anything political right now? if not, why not? >> well, i think they're assuming that you're going to get a clinton victory and yet gridlock. and thereby nobody does much of
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anything to sarah's earlier comment about democratic sweep, i think you would see the pharmaceuticals come under pressure. you would see maybe a lot of the financial area, the big banks and other people come under pressure. so that is more about where the two houses sit, the senate and the house. >> although health care's actually the outperformer in today's session. it's one of two industry groups higher along with utilities. it's been sort of a mixed bag in terms of sector performance this week. the banks have also shined. >> yeah, no, they wax and wane, and i think that's because it does look a little bit like gridlock. so gridlock will allow for a minor sigh of relief in those areas. if the sweep looked obvious, then i think they would both come under some pressure. >> art, thanks, good to see you. >> my pleasure. >> art cashin. tesla finally revealing a much-anticipated announcement last night revealing a new driverless strategy.
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the electric carmaker says all of its new vehicles will now be equipped with hardware that enables fully autonomous driving. tesla adding it plans to have a vehicle drive itself from los angeles to new york by the end of the year. phil lebeau earlier saying even though we've seen the technology from tesla in the past, more dangerous accident prone technology, nothing like this. this is fully autonomous. clearly though it hasn't impressed investors that much. the shares dropped in the after hours when it was released, this morning as well. >> yeah, cramer this morning saying there's really a split between the technology and the mission the company's after in the long run. and the amount of money it's going to take to actually produce these cars and sell them at this price point. maybe that has to change. but clearly musk is a believer in the software saying it's twice as safe as a human, maybe better than that. and that the media has a responsibility to help drivers get into these cars because he argues they're safer in them.
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>> he's a little angry at the media lately when it comes to some of the safety claims on tesla. the question to your point for investors is ke he produce it on time, can he live up to the targets? the ideas are certainly there. let's send it out to jon fortt with a look at what is coming up on the next hour of "squawk alley." jon's out west today. hi, jon. >> that's right, sarah. still at the vanity fair summit. expect to see jeff bezos here today. that's attracting a bit of attention. on "squawk alley" ceo of imax talking about virtual reality. they've also got earnings today. we're also going to have the head of the ford foundation and ask about how technology is affecting the future of philanthropy. we'll be right back. a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods?
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♪jake reese, "day to feel alive"♪ investors have been fleeing the so-called safety stocks. why? what does it mean for the overall market? find out at more "squawk on the street" coming up.
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look at shares of verizon down about 2% as they were in the premarket reporting earnings beat analyst estimates by two cents but revenue did fall slightly shy. a challenging environment is what they say the environment is like right now commenting a bit on nfl streaming. we've actually seen a healthy increase in viewership on our platform around nfl. this is coming from the call. trying to answer some questions as to how viewership is migrating across platforms in general. >> yeah, everybody's talking about that. also making some comments on of course the yahoo deal in the wake of the security breach. the cfo saying we have to assume it will have a material impact on yahoo. lawyers had a first call yesterday. he said unless yahoo comes up with a different process, it's going to take some time until things -- we haven't reached any conclusions. of course that question as yahoo is going to be acquired by verizon and how the big security breach, one of the biggest ever,
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is going to impact that deal. clearly shares of verizon under pressure. also when it comes to subscriber growth, i thought it was interesting the cfo noted that the samsung recall had a bit of an impact as well saying we were off to a good start but the recall impacted growth because historically verizon has been a number one seller of samsung galaxy notes. >> postpaid down for the first time, although they add 36,000 fios customers, 90,000 high speed internet customers, as we were talking with cramer earlier this morning, all these new streaming platforms today, it's google reportedly starting next year this youtube channel called unplugged. you're going to need high speed internet to watch anything even if you are a so-called cord cutter. >> yeah. that's something that verizon has been all over with part of its acquisition strategy. i'm just looking at the dow because clearly verizon is a dow member, it's down about 2%. it's one of the biggest laggards, but american express on the other hand we were talking about this theme of earnings looking better, even
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art cashin been somewhat pessimist has been impressed with what he's seeing on bottom lines. top line growth not as good, but certainly getting there. axp almost up 5%. >> it's not every day you see american express leading the s&p and certainly not up 8.5%. >> down 13.5% over the last 12 months, but is this a turnaround i think is one question investors are asking. we have a lot more to get to tonight by the way. microsoft is after the bell, athena health, schlumberger, paypal. >> mcdonald's tomorrow. >> some of the marquee names still have to be set for the week. but we're definitely in the throes of it now. definitely in the throes of earnings season. >> and technology, i mean, the banks kicked us off right. that's what happened last quarter. the question is can technology keep up the momentum. >> and starbucks howard schultz the ceo weighing in on the presidential election last night. this is what he said on "closing bell." take a listen.
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>> i'm very enthused and excited about hillary clinton becoming the next president of the united states. she's the most qualified person. and i think given the divide and how vitrealic the campaign has been, i look forward to the election being over and hillary clinton becoming the next president of the united states. >> howard schultz who once wrote an op-ed about his aspirations in politics or lack thereof. >> his name was on that wikileaks release of the v.p. food groups, according to the hillary clinton campaign e-mails. there was a whole section on ceos, which of course was always -- it's a fun parlor game to talk about. it was clearly a loosely very early defined list of v.p. candidates, howard schultz on there, tim cook, a number of other ceos clearly friendly with hillary clinton. >> yeah. meg whitman, mark cuban at the debate last night. >> i heard meg got the first hug post debate. >> i did not see that.
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but then of course andy budser writing op-ed for our website last week abdomen ceos in the s&p who are supporting trump. >> small business. >> harold hamm. ceos weighing in on politics to varying degrees is probably the lesson. >> yeah, and to larry's point that 15% corporate tax rate across business, especially small business, with larry kudlow made the point we don't hear enough actually in these debates and on the campaign that it's the first big tax cut for small business if it were to happen, if trump were to get elected and he could pass it through congress. >> dow's down about 53 points. s&p 2136, cashin says to watch out for 2130. we're back after a break.
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59 points, 60 points down the dow, about a third of one percent, the s&p 500 also losing some steam. we've been all over the map. not huge moves today but we are moving to the downside as the trade goes on. 2,135 on the s&p, the nasdaq down about half a percent as well. an extrying to help the dow, but clearly things are moving to the downside as art cashin just told
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us, tracking oil, which has also moved lower. >> busy morning with the debate last night, ecb holds rates unchanged, claims elevated a little bit, philly fed not terrible, dollar index close to the highest since march. we'll pay attention to that. existing homes, first-time home buyers go from 31% of homes bought to 34%. peter boockvar wondering whether or not millennials have had it with high rents and have decided to make the plunge if they can get a mortgage. >> move out of the parents, the rentals and moving in, which would be a big chunk of the housing market. the big headline with ecb, mario draghi saying we didn't discuss extending quantitative easing. perhaps they'll decide that in december. it runs out in march mep said it can't go on forever, maybe disappointing those qe junkies that are expecting that to happen. the upshot is you have a weaker euro against the dollar. >> henry blodget, business
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insider, joins us here at post 9 to talk about the debate last night. good to see you. >> great to be here. >> let's start with listening to the exchange regarding tax policy which got a fair amount of attention. take a listen. >> we are going to cut taxes massively. we're going to cut business taxes massively. they're going to start hiring people. we'll bring the $2.5 trillion offshore back into the country. we are going to start the engine rolling again because right now our country is dying. >> mr. trump. >> at 1% gdp. >> let me translate that if i can, chris, because -- >> you can't. >> first third of the debate policy heavy, some said the most -- >> startling. >> -- in a debate we've had until midway through, he says he wouldn't commit to accepting the election results if he lost. what's more important right now? >> in terms of policy or whether -- >> or that comment, yeah. >> well, the discussion about taxes was actually interesting. i think that hillary clinton correctly says, look, this is a repeat of the bush tax cuts.
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we saw what happened last time. but on the republican side, obviously, there is just an jong beli -- ongoing belief, if you cut taxes it will stimulate hiring. running a business, taxes do not affect the way we think about it, the number of people we hire. certainly trump identified one problem we have to solve, which is the money that is stashed overseas because of the ludicrous policy, and i think one thing a lot of people agree on is trump is right about ko t corporate taxes. we have to do something about our system because we're in this ludicrous situation where companies can't invest the united states. >> he also took on the subject of wikileaks with hillary clinton's e-mails. listen to what donald trump said about that. sta, you know, wikileaks came out, john podesta said some horrible things about you and, boy, was he right. he said some beauties. and, you know, bernie sanders, he said you have bad judgment. you do. and if you think that going into
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mosul after we let the world know we're going in and all the people we really want, the leaders, they're all gone, if you think that was good, then you do. now, john podesta said you have terrible instincts. bernie sanders said you have bad judgment. i agree with both. >> do you think his argument or hillary clinton's argument that it is russia according to our u.s. intelligence officials that are intervening in our election lands, which resonates more with the voters? >> i think a few things pip think, one, just the tone of the debate, again, that segment in particular, highlighted, just so unprecedentedly negative, and i do hear a lot of people saying, like, just sick of it. can we actually do what we did in the beginning of the debate, which is talk about policy? i do think that hillary clinton scored some points by saying, look, the entire intelligence community agrees that russia hacked and then leaked to wikileaks here. how can you not be paying attention to that other than the
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fact that it clearly is helping you so now you're cheering for it and it was actually very interesting to hear marco rubio come out and say, we have to be careful here, may be us next. >> henry, more from you in "squawk alley." more on the debate and of course our interview with nigel faraj on "squawk alley." we'll be right back. gilman: go . go get it. gilman used his cash rewards credit card from bank of america to earn 1% cash back everywhere, every time. at places like the batting cages. ♪ [ crowd cheers ] 2% back at grocery stores and now at wholesale clubs. and 3% back on gas. which helped him give his players something extra. the cash rewards credit card from bank of america. more cash back for the things you buy most.
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good morning. it is 8:00 a.m. at ebay headquarters in san jose, california, 11:00 a.m. on wall street, and "squawk alley" is live. ♪ ♪ there's a mountain in my way good thursday morning. welcome to "squawk alley." i'm carl quintanilla joined by kayla, sara, henry


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